the red LED on the dash is an indicator for your aftermarket keyless entry/alarm system that tells you when its armed. Sometime people have wired a toggle switch into an aftermarket alarm system to disable it once inside the vehicle, try and find one under the dash area, anything that doenst look OEM (stock).
another thought, I once worked at a GMC dealer and had to bring a jimmy into the shop people used to have kill switches wired into strange places to prevent there car from being started even if it was broken into. This particular Jimmy had a pressure switch under the carpet you had to push down on the area with your foot and turn the key at the same time. Other people would wire them into the cruise control button or just hide a switch somewhere near the drivers seat or under the dash area.
I myself would be removing that alram system completely and returning all wiring to stock, but I understand this may not be in your skill level.